Caustic Soda stabilizes following firm demand with ample raw material availability

Caustic Soda prices witnessed a decline in the US market due to a reduction in demand from the downstream industries because of ample availability of raw materials. Similarly, the European market witnessed a decline in the month of April because of low demand from the downstream market. Whereas, in Asia, the price trend showcased stability due to stable offtakes and desired availability of raw material for Caustic Soda. In India, change in season resulted in lower consumption of Caustic Soda in the textile industry.

Ample availability amid stable demand from the domestic market narrowed the demand-supply gap for caustic soda across the globe in early April as compared to the previous quarter. In Germany, several regional buyers were heard to have returned to the Chinese market due to relatively lower prices which ultimately resulted in the declining offtakes in the international market of Caustic soda leading to reduction in prices of Caustic Soda.

Asian Caustic soda prices, on the other hand, witnessed stability due to sufficient availability of raw materials to maintain desired offtakes in the international as well as the domestic market. The supply of Caustic soda remained lengthened amid limited enquiries from the downstream sectors in India and unchanged demand patterns. Traders and buyers showed cautious behavior and preferred to procure only quantities required amid mulling uncertainty. The Chinese government’s ‘zero Covid Policy’ led to lockdowns in major industrial cities leading to a stagnation in demand, which has eventually offset the cost pressure from high energy costs and tight supply fundamentals.

As per ChemAnalyst, “the price trend of Caustic soda is expected to show gradual ease in the European market as material availability is likely to be persistent due to low offtakes in the international market post Russia’s invasion of Ukraine”.